BIS Update Conference 2012 - Summary of Day 2

July 18, 2012 BIS Update Conference 2012 - Summary of Day 2

Here is a summary of our live tweets (Hashtag #BISUpdate) from day 2 of the Bureau of Industry's 25th annual Update Conference on Export Controls and Policy:
BIS Update day 2 starts with speech by Assistant Secretary for Export Enforcement David Mills. Today's breakout sessions include: deemed exports; entity list; regulatory review; automated export system.Mills: This year marks 30th anniversary of Office of Export Enforcement. OEE is only agency of US government that specializes in export enforcement.Mills: export enforcement statistics 2011 - criminal conviction on 10 companies and 29 individuals and $20 million in fines. Administrative penalties included 39 settlements and $8.5 million in civil penalties.  Mills - OEE encourages voluntary disclosures. Only small number of VSDs led to imposition of penalties. In FY 2011 BIS issued 227 warning letters and in FY 2012 181 warning letters have been issued to date.Mills: discussed a number of successful export enforcement investigations and penalty cases resolved over the past year. Mills: regarding VSDs, BIS has made significant progress in closing out VSD backlog. Mentioned following statistics:closed 60% of VSDs submitted in 2011 and 30% of VSDs submitted in 2012. Reiterated that 97% of VSDs resulted in no penalties. Mills: mentioned importance of complying with Antiboycott regulations. Noted that 8 antiboycott penalty cases were settled in 2011. Also mentioned US Govt meetings with boycotting countries has led to one country agreeing to remove boycotting language from documents. Next session is an interagency panel on export controls, including officials from Departments of State and Defense. Noted that 15,652 licenses issued by BIS in FY2012. 212 were sent to Operating Committee and 26 were sent to next level for review. 788 CJs were issued in FY12.Some other news from Update: BIS has unveiled a new Strategic Trade Authorization (STA) Interactive Compliance Tool on its website at http://t.co/xGa49eyv. Other news from BIS Update: A new address verification feature will be soon be added to SNAP-R electronic licensing system. In other sanctions news, today OFAC added a number of high ranking Syrian officials to the SDN List: http://t.co/4y9ypaMb Full text of opening remarks by BIS Under Secretary of Commerce Eric Hirschhorn at Update 2012 found here: http://www.bis.doc.gov/news/2012/hirschhorn_update_2012.htmFull text of yesterday's remarks by BIS Assistant Secretary Kevin Wolf at Update 2012 found here: http://www.bis.doc.gov/news/2012/wolf_update_2012.htmKeynote speaker at Update day 2 is FBI director Robert Mueller. FBI Director Mueller now speaking at Update on export controls and enforcement issues. Noted impact of globalization on technology and information flows. Noted efforts by procurement networks to obtain controlled technology. Also noted internal threats by employees having access to controlled technology.RT @dcsleeps: Extremely powerful and moving presentation by Master Sergeant Jarrett Jongema re IEDs and counter-proliferation efforts.FBI Director Mueller mentioned several past and ongoing export controls enforcement investigations and convictions against persons and procurement networks. Noted importance of FBI's partnership with private sector in export control cases. Stressed importance of recognizing red flags. The full text of FBI Director's remarks today at Update can be found here on FBI's website: http://t.co/FTqaWGca Export enforcement panel now underway at Update. Moderated by DAS Salo. Panelists include directors of Office of Export Enforcement, Office of Antiboycott Compliance, Office of Chief Counsel and Office of Export Analysis. Export enforcement panel using pre-submitted question and answer format as in the past. Several questions on antiboycott compliance and jurisdictional issues, including scope of "US Commerce." Director of Office of Antiboycott Compliance said that BIS and UAE are working together to remove prohibited boycott language from agreements, tenders and other documents issued by UAE companies.BIS Office of Antiboycott compliance mentioned growing number of boycott requests involving Malaysia.  BIS will soon be issuing modifications to the Unverified List to update the parties on that list. Inclusion of a party on the Unverified List is a red flag.
Reminder: On Thursday, July 19th, Assistant Secretary for Export Administration Kevin Wolf and other BIS regulatory and technical specialists will address issues related to the current export control reform effort in open forum telephone conference calls on July 19th from 10:00 am-12:00 pm EDT and from 1:00 pm-3:30 pm EDT. While live questions will not be taken, callers are encouraged to submit questions to BIS in advance by e-mail the following email address: OESDSeminar@bis.doc.gov. The dial-in number and passcode for the teleconferences is as follows: Call in Number: 888-455-8218; Passcode: 6514196.

Presentations from BIS are now posted on the BIS web site, Update 2012 Presentations or on the BIS BETA web site Update 2012 Presentations.Labels: BIS Update Conference

 

BIS Update Conference 2012 - Summary of Day 3

July 19, 2012 BIS Update Conference 2012 - Summary of Day 3

Here is a summary of our live tweets (Hashtag #BISUpdate) from the third and final day of the Bureau of Industry's 25th annual Update Conference on Export Controls and Policy:

Third and final day of BIS update now underway. Roundtable discussions with BIS, OEE, DDTC, OFAC and CBP staff very well attended. The roundtables are a great opportunity for exporters and one of the most useful aspects of BIS Update. Open forum on export control reform and move of certain items from USML to CCL now underway. BIS Assistant Secretary Wolf now answering numerous questions on pending rules, including "specially designed" and transition rules. Public comments on those rules are greatly encourage. Export control reform will greatly minimize number of commodity jurisdiction requests submitted. Idea is to make USML and CCL objective lists with bright lines on jurisdiction. First 38(f) notification likely to be submitted by State to Congress later this fall. Here is the export control reform "Iceberg" slide now on screen. http://t.co/gKZvPnf7. Here is export control reform "Iceberg" slide now on screen. Subtitled "a visual metaphor of relative and non-visible export control burdens, not sinking ships" Final #BISUpdate sessions today on encryption controls, export control reform and export controls for small and medium sized companies. Full text of remarks by Assistant Secretary for Export Enforcement David Mills at BIS Update can be found here: http://t.co/QB0m24nK BIS and Census are considering making changes to Routed Export Transactions. Census Bureau likely to publish final rule making changes to Foreign Trade Regulations and AES filings later this year. During final session on encryption controls BIS officials discussed the various changes to encryption regulations over the past 2 years, including the inclusion of Note 4 to category 5 part 2 and other types of encryption software not subject to the EAR. Lots of positive comments from BIS Update attendees about program, speakers and venue of this year's Update conference. Assuming that export control reform continues to move forward as we expect the CCL and USML should look very different at next year's version of BIS Update.It is important for industry and exporters to continue submitting comments on the various proposed export control reform regulations issued by BIS and DDTC rules, including the proposed rule regarding the definition of "specially designed" and the "transition" rule. The deadline for submitting comments on those rules are August 3 and August 6, respectively.

Presentations from BIS are now posted on the BIS web site, Update 2012 Presentations or on the BIS BETA web site Update 2012 Presentations.Labels: BIS Update Conference

 

BIS Update Conference 2012 - Summary of Day 1

July 17, 2012 BIS Update Conference 2012 - Summary of Day 1

Today is the first day of the Bureau of Industry's 25th annual Update Conference on Export Controls and Policy. Here is a summary of our live tweets (twitter.com/tradelawnews) from day 1:
Annual BIS export controls Update starts today in DC. More than 1000 attendees. Will live tweet over next few day. Hashtag #BISUpdate For those not able to attend Update, materials and webcasts are available on BIS's website. See http://t.co/UpJUEu0a for details.First speaker - BIS Undersecretary Hirschhorn stressed need for exporters to stay engaged on export control reform (ECR). As part of Export Control Reform (ECR), first 38(f) notifications on transfer of items from USML to CCL will take place later this year. Future issues to be reviewed by BIS include cloud computing, deemed exports, CCL review, recordkeeping, etc. Next speaker- Asst Secy of State Andrew Shapiro. ECR intended to prioritize controls, not decontrol items. Will lead to better enforcement. Asst Secy Shapiro - "speculation that ECR is stalled is false". Momentum not being lost. Results of hard work on ECR are in reach. Next speaker- Asst Secretary Wolf who has played key role in ECR. While ECR appears to be slow, actually moving quickly when looking at big picture. ECR will make export controls understandable by "Muggles." USML Cat XI (electronics) likely to be published in coming weeks. Here is some information from on the record press briefing by senior BIS and State Dept officials at Update. BIS would like to issue changes to encryption rule in future. Other future changes to regs include cloud computing. Regarding 38(f) process, working closely with Congress and have made changes as a result. Concerned about various amendments to pending legislation on satellites that could have adverse impact on ECR. Hope that satellite legislation can be taken up this year. E2C2 export enforcement coordination center up and running. Update breakout sessions on sanctions, AES, control list changes and end use monitoring. Many of the presentations can be found on the BIS website at http://www.bis.doc.gov/seminarsandtraining/update2012/presentations.htm OFAC participated with BIS on sanctions panel and clarified some points on new Burmese general licenses. Also answered questions on various sanctions programs and licensing issues. OFAC clarified that the new reporting requirement in Burma GL applies to investments greater than $500,000 only and not sales over that amount. OFAC also stated that average processing time for Iran TSRA Ag/Med licenses is 3 months. No real downturn in applications of TSRA applications due to Iran payment issues. also, BIS reiterated importance of reviewing both OFAC and BIS regs due to overlap of jurisdiction in some programs. Regarding press reports re Apple products being denied for Iranians in US, OFAC said that OFAC regs are not discriminatory but that an OFAC license is required when controlled good are exported to Iran. Keynote speaker today is Acting Secretary of Commerce Dr. Rebecca Blank. Acting Secretary of Commerce Blank discussing National Export Initiative and other economic issues relating to exports, including new free trade agreements. Mentioned importance of repealing Jackson-Vanik and permanent MFN for Russia. Promoted current export control reform efforts and reiterated that ECR is not decontrol. Noted herculean efforts made so far in ECR and that no other administration has got this far. Hopes to have some final changes from USML to CCL published by end of year. Export enforcement panel VERY well attended. Discussing IED components concerns and continued focus on enforcement involving China and Iran. Pakistan still an illegal procurer and discussed joint OEE and FBI investigation efforts in procurement networks. Also discussed trends in voluntary self disclosures. Noted only 3% of VSDs led to penalties. Will be 20% increase in enforcement outreach efforts. DDTC and BIS panel discussing details on implementing ECR. All 600 series items must be reported in AES, regardless of value. Post departure AES filing not eligible for 600 series. Special destination statement required for 600 series items. BIS expects 30K increase in licenses. BIS information triage unit is reviewing legitimacy of exports. Enhanced data sharing with DDTC and end use monitoring. DDTC and BIS panel discussing details on implementing ECR. RT @CommerceSec: just finished with my remarks at the Conference on Export Controls Policy, hosted by our Bureau of Industry and Security. Head of DDTC export compliance now discussing enforcement issues related to defense articles. Discussing end use checks, export license due diligence, red flags.  Information and updates on export control reform can be found at http://export.gov/ecrLabels: BIS Update Conference